SmallBiz Vote

Economic uncertainty plagues small businesses, survey shows

source: NSBA 2012 Midyear Economic Report

"The constant barrage of negative campaigning and near-complete failure of Washington to govern is having a broad, negative effect on America's small businesses," according to National Small Business Association President and CEO Todd McCracken. NSBA today released its mid-year economic report, which reveals that, since the organization's December 2011 year-end report, the number of small-business owners who anticipate a recessionary economy has jumped from 14 percent to 34 percent and the number who anticipate economic expansion in the coming 12 months has dropped from 20 percent to 11 percent.

Still, more than half of respondents (55 percent) expect a flat economy in the coming year and the same ratio says their businesses are already growing or will see growth opportunities in the coming year.

Economic uncertainty was cited by 68 percent of small business owners surveyed as the most significant challenge to the future growth and survival of their business. Other significant challenges they cited: Decline in consumer spending (42 percent), regulatory burdens (38 percent), cost of health insurance benefits (33 percent), the growing national debt (27 percent), federal taxes (26 percent; up from 19 percent six months ago), and lack of available capital (23 percent).

Asked which issues Congress and the Obama Administration should address first, the national debt came out at the top of the list with 34 percent of respondents citing it as their biggest concern. Reducing the tax burden and regulatory burdens on small business were the second and third most popular priorities, named by 14 and 13 percent of respondents, respectively.

A majority of survey respondents (68 percent) say the economy is in worse shape today than it was five years ago, but NSBA pointed to one "bright spot" in its survey results: "the long-term economic outlook is slightly improved with 23 percent now saying that today's economy is better than it was five years ago, the highest it's been in four years." The 75-year-old organization says it is "focused on federal advocacy, and operating on a staunchly nonpartisan basis."

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